That is because some lenders have been changing the terms for cardholders who carry a balance, by charging an additional fee or requiring higher minimum monthly payments.
An article in the Wall Street Journal draws attention to steps being taken by many credit card companies to recoup their losses and protect themselves from risk.
For example, JP Morgan Chase is set to begin charging a $10 fee for maintaining a balance for more than two years, as well as increasing the level of the minimum payment.
“Given the current environment banks are starting to get very scared of the backlog of debt they’re owed from their current borrowers who have carried balances,” Greg Larkin of Innovest Strategic Value Advisors told the news provider.
Adding new fees to existing accounts is just one type of change being enacted by financial institutions that are under strain – others are lowering credit limits or raising interest rates.
Citigroup – whose troubles have led it to accept $25 billion additional from the government to keep it afloat – recently announced that it will be raising interest rates for around 10 million customers.
However, if you are among those who are affected by such a change, you may still be able to opt out.
Check your mail for any letter advising you of changes to the terms of your account – this should include information on opting out of the higher rate.
Keep in mind that taking this action usually effectively means closing the account, which would affect your credit score.
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